One Approach to Orange-Pilling Local Merchants

(Without Talking About Sound Money)

Reading time: 10-12 minutes

I've only been in Bitcoin for about a year, but these past few weeks have been exciting: Square just enabled 4 million merchants to accept Bitcoin for payment.

When the people who taught me to set up a node also explained that Bitcoin is money—not just an investment—they were clear: if I wanted this to succeed for my kids and their kids, it has to be spent. So I get the spend and replace mindset.

I'm also a small business owner. Every year I pay between $7,000 and $10,000 in credit card processing fees. Every January, I review those fees and think I'm getting ripped off.

But even with that pain point, I don't think leading with "lower fees and no chargebacks" is the best way to orange-pill a brewery owner, a liquor store, or a coffee shop.

Here's why.

When I heard about Square's announcement, I immediately thought of my local coffee shop—where I know people's names, where they have a Square terminal. I thought: "How would I actually convince them to do this?" So Claude AI and I modeled three businesses to see how the math works: a coffee shop ($400K revenue, $10 average transaction), a liquor store ($700K revenue, $32 average transaction), and a brewery ($1M revenue, $30 average transaction).

What follows is the breakdown for each business: how they can add meaningful value by accepting Bitcoin, and if they take it a step further and keep some Bitcoin on their balance sheet, how it could genuinely impact their business over the next 5-10 years. What we found is that the brewery—with its higher revenue and transaction size—has the most to gain from accepting Bitcoin payments from just a small portion of its customer base.

Before we dive into the numbers, here are two quotes from people much smarter than me who've been in Bitcoin longer, explaining why adoption matters:

Jeff Booth: "Spend in it. You don't have to wait for anyone or ask for permission. The more we spend, the more adoption we get, and the stronger the network becomes."

Lyn Alden: "The network becomes a self-sustaining global economy of people wanting to save in it, and then spend it, and earn more of it, save more of it, and then spend it. Like, well… money."

We all know Bitcoin needs to move through three stages: store of value, medium of exchange, and unit of account. The store of value part is strong in 2025. This document is about medium of exchange.

So let's not lead with concepts like "sound money" and "fiat debasement"—things that matter to us but mean nothing to a merchant trying to make payroll. Let's lead with how Bitcoin helps their bottom line.

Let's Be Clear About What We're Actually Asking

Before we dive into the numbers, let's establish something important: this isn't some pie-in-the-sky scenario that requires unrealistic adoption or Bitcoin going to the moon.

We're making very conservative assumptions about customer adoption. In 2026, we assume only 1% of customers will want to pay with Bitcoin. By 2030, that grows to 4%.

These are realistic numbers - there's already buzz in the Bitcoin community about Square's launch, and Bitcoin users actively seek out businesses that accept it using tools like BTCMap.org.

For a brewery doing $1M in annual revenue, that 1-4% adoption means they'll receive about $115,000 in Bitcoin payments over five years - out of $5 million in total revenue. That's roughly 2.3% of their business.

Now here's where the 50/50 strategy comes in. When we say "50/50," we mean the merchant converts half of those Bitcoin payments to cash immediately and holds half as Bitcoin. So the merchant is holding about 1.15% of their total revenue in Bitcoin over five years. That's it.

If they do this, the brewery accumulates about 0.21 Bitcoin over those five years. You and I both know that in 2030 and 2035 this is a meaningful amount of bitcoin. When you consider that all the merchant has to do is (a) set up their Square terminal and (b) accept bitcoin, this is a no brainer.

For a liquor store doing $700K in revenue, the numbers are also compelling - they could accumulate about 0.15 Bitcoin using the same strategy.

We're not asking merchants to revolutionize their business or take massive risks. We're asking them to make a choice about what to do with roughly 1-2% of their revenue that will come from customers who actively want to pay with Bitcoin.

That's the opportunity. Now let's look at how the math actually works.

What Square Launched on November 10, 2025

Quick review about what Square is offering merchants:

• 0% processing fees through all of 2026
• 1% processing fees starting January 2027
• Merchant's choice:
  • Hold Bitcoin
  • Auto-convert to USD
  • Split 50/50 (or any percentage)

Compare this to Square's normal credit card fees: 2.6% + $0.15 per transaction.

So accepting Bitcoin is dramatically cheaper than accepting credit cards. And merchants can choose to convert everything to dollars immediately, hold everything in Bitcoin, or split it however they want. Zero forced exposure. Zero mandatory conviction.

The Cash App Integration Changes Everything

Square also announced that 58 million Cash App users can now pay with USD while the merchant receives Bitcoin. The merchant's customer doesn't need to own Bitcoin, understand Bitcoin, or open a Phoenix wallet or Strike account. They just scan a QR code with Cash App, pay in dollars, and the merchant gets settled in Bitcoin instantly via Lightning.

This solves the "nobody has Bitcoin to spend" objection. The brewery's regular customers can use Cash App without thinking about Bitcoin at all. This is huge for adoption.

Why Transaction Size Matters

I modeled three businesses because the math is dramatically different based on average transaction size. The 2.6% + $0.15 fee structure hits differently when you're processing $10 vs $30.

Ned's Coffee: $10 average transaction

• Credit card cost: $0.41 per transaction (4.1% effective rate)
• Bitcoin 2027+: $0.10 (1%)
• Savings: $0.31 per transaction

Vino Locale (liquor store): $32 average transaction

• Credit card cost: $0.98 per transaction (3.1% effective rate)
• Bitcoin 2027+: $0.32 (1%)
• Savings: $0.66 per transaction (2.1x the coffee shop)

Hop Culture Brewing (brewery): $30 average transaction

• Credit card cost: $0.93 per transaction (3.1% effective rate)
• Bitcoin 2027+: $0.30 (1%)
• Savings: $0.63 per transaction (2.0x the coffee shop)

This is the targeting strategy: Higher-transaction-value businesses are better targets. The percentage fee hurts way more on a $30 sale than on a $10 sale.

The Math: Three Very Different Businesses

Let me break down the full picture for each business type, assuming conservative Bitcoin adoption growth from 1% of transactions in year 1 to 4% by year 5.

Hop Culture Brewing: $1M Revenue, $120K Net Profit

• Annual credit card fees: $31,000
• ~33,333 transactions/year (107/day)
• Percentage fees (2.6%): $26,000
• Per-transaction fees: $5,000
• 5-year Bitcoin payment volume: $115,000 (1-4% adoption)

Vino Locale: $700K Revenue, $140K Net Profit

• Annual credit card fees: $21,481
• ~21,875 transactions/year (60/day)
• Percentage fees (2.6%): $18,200
• Per-transaction fees: $3,281
• 5-year Bitcoin payment volume: $80,500 (1-4% adoption)

Ned's Coffee: $400K Revenue, $100K Net Profit

• Annual credit card fees: $16,400
• ~40,000 transactions/year (110/day)
• Percentage fees (2.6%): $10,400
• Per-transaction fees: $6,000
• 5-year Bitcoin payment volume: $46,000 (1-4% adoption)

The Three Strategy Options

Before we look at projections, here's what's important: we need to think like a business owner who doesn't own Bitcoin. Square gives them three choices:

Strategy 1: 50/50 Hybrid - The Sweet Spot for 2026?

Split every Bitcoin payment—50% converts to dollars immediately, 50% stays in Bitcoin.

I'm using Power Law price projections for this analysis: $135K in 2026 rising to $480K by 2030. Look, neither of us knows exactly where Bitcoin will be at the end of 2026, and 2030 feels like a long way off. If you have a different model you prefer, use that instead. But for the rest of this document, I'm sticking with Power Law. The one thing I think we can agree on: Bitcoin in 2030 will be worth more than it is in 2026.

Hop Culture Brewing (5-year results):

• Cash accumulated: $57,500
• Bitcoin accumulated: 0.2104 BTC
• Bitcoin value in 2030: $101,048
• Fee savings: $3,215
• Total business value: $161,763
• vs. credit cards after fees: $111,435
• Net benefit: $50,328 more

Vino Locale (5-year results):

• Cash accumulated: $40,250
• Bitcoin accumulated: 0.1474 BTC
• Bitcoin value in 2030: $70,789
• Fee savings: $2,528
• Total business value: $113,567
• vs. credit cards after fees: $77,200
• Net benefit: $36,367 more

Ned's Coffee (5-year results):

• Cash accumulated: $23,000
• Bitcoin accumulated: 0.0842 BTC
• Bitcoin value in 2030: $40,438
• Fee savings: $1,466
• Total business value: $64,904
• vs. credit cards after fees: $44,115
• Net benefit: $20,789 more

Who this is for: Most business owners. They get certainty (cash) and upside (Bitcoin) without betting the farm.

Why this works: Even if Bitcoin dropped 50%, they still have the cash half plus fee savings. They're still ahead of credit card processing. The downside is capped. The upside is substantial.

Why 50/50 Is Probably the Right Strategy for 2026

Most business owners aren't Bitcoiners yet. They're curious, maybe intrigued by the fee savings, but they're not ready to bet their business on something they just learned about.

The 50/50 strategy does something psychologically important: it gets them accustomed to seeing Bitcoin accumulate.

Every week, they'll check their Square dashboard and see both dollars (comfortable, familiar) and Bitcoin (growing, interesting). Over a few months, they'll watch that Bitcoin number go up—first in quantity (0.01 BTC... 0.02 BTC... 0.05 BTC), then likely in dollar value as Bitcoin appreciates through 2026-2027.

By the time Bitcoin crosses $200K—perhaps in late 2027—they'll have 12-18 months of experience with it. They'll have seen it work. They'll have loyal Bitcoin customers they know by name. They'll have a meaningful stack—not life-changing yet, but enough to make them pay attention.

At that point, many will naturally increase their hold percentage. They might go from 50/50 to 70/30 or even 100%. Not because you convinced them, but because they convinced themselves through experience.

If you're a Coldcard-carrying, node-running Bitcoiner reading this, you'd obviously go 100%. But our job is to convince the brewery owner who's never heard of Satoshi that accepting Bitcoin is something they should do. For them, 50/50 is likely the sweet spot. It's the bridge between "this seems risky" and "this is obviously working."

A note on the strategies below: I'm showing you all three options because different merchants will have different risk tolerances. I've done the math on 100% Bitcoin exposure and 0% Bitcoin exposure so you can see the full range. But for you and me trying to actually get merchants to say yes? I think 50/50 is what we should be pushing for. It gives them the experience of accumulating Bitcoin without asking them to bet their business on something they just learned about. The other strategies are there for edge cases—the merchant who's already orange-pilled (100%) or the one who's terrified (0%)—but start with 50/50.

Strategy 2: Auto-Convert Everything - 0% Bitcoin Exposure

Every Bitcoin payment converts to dollars instantly. They treat it exactly like a credit card payment—except cheaper.

5-year results:

• Hop Culture Brewing: $3,215 saved + loyal customers
• Vino Locale: $2,528 saved + loyal customers
• Ned's Coffee: $1,466 saved + loyal customers

Plus they attract loyal Bitcoin customers who seek them out and tell other Bitcoiners about the business. Bitcoin tourists check maps to find businesses that accept Bitcoin. When they first accept it, local Bitcoin meetup groups will promote them.

Who this is for: Risk-averse operators who just want lower fees and don't want any Bitcoin exposure.

Strategy 3: Hold 100% in Bitcoin - Maximum Exposure

All Bitcoin payments stay in Bitcoin. Their business accumulates it as customers pay.

5-year results (using Power Law projections):

Hop Culture Brewing:

• Bitcoin accumulated: 0.4209 BTC
• Bitcoin value in 2030: $202,160
• Fee savings: $3,215
• Total: $205,375 (vs. $111,435 with credit cards)
• Net benefit: $93,940 more

Vino Locale:

• Bitcoin accumulated: 0.2948 BTC
• Bitcoin value in 2030: $141,578
• Net benefit: $66,906 more

Ned's Coffee:

• Bitcoin accumulated: 0.1684 BTC
• Bitcoin value in 2030: $80,877
• Fee savings: $1,466
• Total: $82,343 (vs. $44,115 with credit cards)
• Net benefit: $38,228 more

Who this is for: Operators who believe Bitcoin's 16-year trajectory continues and can handle volatility.

The actual risk: If Bitcoin went to zero (unlikely given institutional adoption), they've "lost" the profit margin on 1-4% of their sales. For Hop Culture Brewing, that's ~$13,800 over 5 years in actual profit dollars at 12% net margin (1.15% of five-year cumulative profit). Painful, but not business-ending.

What Fractional Bitcoin Could Be Worth in 2035 and Beyond

This is the part where I honestly don't know how important it's going to be to lead with this information in your first conversation with a merchant.

I love the Mike Tyson quote: "Everybody has a plan until they get punched in the mouth." Well, as I'm writing this in November 2025, Bitcoin has dropped from $125K to $82K in a matter of months. If a business owner checked the financial news or saw this on a news channel, they might be thinking: "That's the last thing I want to do with my business revenue."

You and I believe Bitcoin is going to go up. We believe it's going to be worth a lot more in 2030 and 2035 than today. But here's the challenge: unit bias is real, even with intelligent business owners who've run successful operations for years.

When they see 0.08 BTC or 0.15 BTC or 0.21 BTC on their Square dashboard, they don't instinctively think "that's meaningful." They think "that's not even one whole Bitcoin."

So I don't have a perfect answer for how to present this. But I do think the numbers are worth knowing, because they tell a story about what fractional Bitcoin could become if the Power Law model holds.

The Power Law Model

The book Bitcoin One Million by Fred Krueger and Ben Sigman came out a few weeks ago and it's excellent. Their site https://b1m.io is my favorite Power Law calculator. Both resources show that Bitcoin's price has followed a mathematical power law for 16 years with 95% correlation. Fred has a PhD in mathematics and spent years in traditional finance—he'd never seen anything like this.

Projections:

• 2030: $480,000 per BTC
• 2035: $1,000,000 per BTC

What fractional holdings could be worth:

0.08 BTC (Ned's Coffee, 50/50 strategy):

• 2030: $38,400
• 2035: $80,000

0.15 BTC (Vino Locale, 50/50 strategy):

• 2030: $72,000
• 2035: $150,000

0.21 BTC (Hop Culture Brewing, 50/50 strategy):

• 2030: $101,048
• 2035: $210,000

Think about it this way: if the brewery owner is 50 years old, when they're 60, that 0.21 BTC could be worth over $200,000. That's not "invest your life savings" money. That's "hold a small percentage of your business revenue in Bitcoin" money.

And the beautiful part? They're not "investing" anything. They're making a decision about how to handle revenue they're already receiving.

My recommendation: Don't lead with this in your first conversation. Show them the fee savings and the 50/50 strategy first. If they're interested and ask "but what if Bitcoin goes up?" - that's when you share this. I've created a separate resource document that explains the Power Law model in detail that you can give them to read.

Why I'll Personally Avoid the Chargeback Argument

You'll see a lot of Bitcoin advocates lead with "no chargebacks" as a selling point. I get it. "Friendly fraud," when customers dispute legitimate charges to get refunds while keeping the product, is real and has increased nearly 20% over the last three years.

But for most small businesses, I'm not sure they view this as a positive.

I can only speak for myself as a business owner, but any time a customer wants a refund, I refund them. My business runs on word of mouth and testimonials. Friendly fraud isn't happening when someone orders a pint at Hop Culture, or picks up wine at Vino Locale, or grabs coffee at Ned's. Could it happen on a larger purchase? Maybe. But it's likely not common enough to lead with.

I heard a thoughtful question at the Bitcoin Financial Services Summit at The Space in Denver about merchants needing ways to refund people when appropriate. The "no chargebacks" pitch might sound like you're taking away consumer protection rather than offering a better payment system.

These are just my two Satoshis, but I'm definitely not going to talk about this when I approach a business owner.

Why This Matters Beyond One Merchant

What was eye-opening for me when I ran these numbers is that if you can eventually orange-pill a merchant, they're going to end up with a meaningful amount of Bitcoin—even with the conservative 50/50 strategy.

When a merchant accumulates 0.15 BTC or 0.21 BTC and sees it grow to $72,000 or $101,000 by 2030, they don't just become a place where you can spend Bitcoin. They become:

• A Bitcoin advocate who tells other merchants
• A hodler with skin in the game
• An educator for their customers
• Proof that Bitcoin works for normal businesses

You've created a multiplier effect. That one merchant conversation could lead to 5 more businesses accepting Bitcoin, 50 more customers learning about it, and a thriving local circular economy.

They did it because you showed them it was good for their business, not because you convinced them about sound money and fiat debasement.

How You Use This Is Up to You

Now that you've seen the math, you can approach merchants however makes sense for you. Maybe you're the type who prints out the analysis and walks into your local brewery with specific numbers. Maybe you're more comfortable just mentioning it casually and seeing if they're curious. Maybe you want to recruit a few other Bitcoiners from your local meetup and coordinate a neighborhood campaign.

Regardless of your approach, you now have a feel for the real numbers behind a merchant doing 50/50 (or even going full Bitcoin). You know that transaction size matters—a brewery or liquor store saves $0.60+ per transaction while a coffee shop saves $0.31. You know that even the conservative 50/50 strategy puts meaningful Bitcoin on a merchant's balance sheet over 5 years.

Whether you're doing 20K, 33K, or 40K transactions a year... whether you're netting $100K, $120K, or $140K... Bitcoin payments improve your bottom line.

Additional Resources

All resources are available at: https://github.com/orangedaddocs/merchant-onboarding

Detailed Financial Analyses (20 minutes each):

• Bitcoin Payments for Your Brewery - Year-by-year projections, customer psychology, implementation details
• Bitcoin Payments for Your Liquor Store - Fee breakdowns, premium customer data, risk scenarios
• Bitcoin Payments for Your Coffee Shop - Year-by-year projections, customer psychology, implementation details

Two-Page Leave-Behinds (Print on Card Stock):

• Brewery Two-Pager - Drop off for the owner
• Liquor Store Two-Pager - Drop off for the owner
• Coffee Shop Two-Pager - Drop off for the owner

Supporting Documents:

• Why 0.15 Bitcoin Matters - Power Law model, institutional adoption, what fractional Bitcoin could be worth by 2035
• The Merchant Conversation Guide - Scripts, objection handling, tax FAQ

Final Thoughts

The circular economy starts with one merchant. My contribution to this movement is modeling the economics and creating these resources. How you use it is up to you.

Good luck with these conversations! I'd love to hear how they go. I'm Orange Dad on Nostr - orangedad85@happytavern.co

And if you want to send me some sats so I can get breakfast at a spot like Ned's, you can send those to orangedad@getalby.com.

As Ben Justman of Peony Lane Wine says: We're Gonna Win!

Version 2.0 - Brewery Edition Last updated: November 27, 2025 Block height: 925,344

Produced by Orange Dad orangedad85@happytavern.co on Nostr Value for Value sats: orangedad@getalby.com